Employees Face Soaring Health Insurance Costs

The costs to employees for health insurance keep increasing, even as employers pay more also. A Premium Sucker Punch:

Her employer picks up 50 percent of the coverage for her family, up from 33 percent a few years ago. But because insurance costs have soared, she says she’s actually paying $200 a month more in premiums. Her co-pays also have risen to $30 from $20.
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The Corporate Executive Board found in its survey that a quarter of officials from 350 large corporations said they had increased deductibles an average of 9 percent in 2008. But 30 percent of the employers said they expected to raise deductibles an average of 14 percent in 2009. Mercer, a global benefits consulting firm, surveyed nearly 2,000 large corporations in a representative poll and found that 44 percent planned to increase employee-paid portion of premiums in 2009, compared with 40 percent in 2008.

The economic slowdown, according to analysts, is making it more difficult for many employers to subsidize health care costs at previous levels. On average, experts say, benefit packages contain the biggest increases for workers since the recession of 2001. Workers’ health costs are rising much faster than wages.
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Premiums for employer-sponsored plans over a decade on average have risen to $12,680 a year from $5,791, according to the Henry J. Kaiser Family Foundation. The median deductible for the plans was $1,000 in 2008, compared with $500 from 2001 to 2007, according to a survey of 2,900 employers conducted by Mercer.

The broken health care system in the USA has been a huge drain on the economy and people’s standard of living for decades. The longer we allow the system to decline (increasing costs, declining results) the more damage the economy suffers and the larger the costs to implementing fixes become.

According to a new report by the Pew Trust, states in the US collectively spent $31 billion to insure 2.7 million employee households in 2013, an uptick in spending from 2011 and 2012 after adjusting for inflation. The average per-employee per-month premium for employees’ and dependents’ coverage was $963. States paid $808 (84 percent) of the total on average, and employees covered the remaining $155 (16 percent).

Remember when President Obama promised back in 2009 that his health care reform plan would cut insurance premiums for the average family by $2,500? Four years later, those promised cuts have morphed into admissions of price hikes.
Indeed, America’s health cost crisis shows no signs of stopping. And Obamacare will only make it worse by injecting more government into the health sector.

Things like Obamacare cannot be discussed, it seems, in anything but a political context. So if you don't like Obamacare, everything that happens has to be bad. But I actually think this is good news, and goes against my fears in advance of Obamacare. I had been worried that Obamacare would just increase the trends of more and more health care spending being by third-party payers.

The decisions over the past 30 years to pass huge huge tax bills to those in the future is unsustainable. Saying you cut taxes when all you actually do is postpone them is dishonest. However, many people go along with such false statements so politicians have learned to buy votes today by raising taxes on the future.

The health care system in the USA is broken, and has been for decades. The economic consequences of failing to implement effectively solutions has been immense. Finally, the momentum demanding change is growing. I still think the entrenched interests are going to delay needed reform, but hopefully I am wrong.

We have had over 20 years of health care costs going up more than inflation – every year. That is an amazing (and horrifyingly bad) record. We need very strong evidence to conclude we can even just reduce the increase in damage done year after year by the broken health care system.